Brexit: UK economy will grow slower than all other G7 advanced countries this year, City bosses warn

Senior executives at more than 100 banks, as well as asset managers, insurers and private equity firms express concerns about Britain’s prospects

UK economic growth will lag behind all other G7 advanced nations this year, the world’s biggest financial firms have warned.

Almost three-quarters of 100 senior executives surveyed said they worry that UK economic growth will be weaker this year than in any other advanced economy – a dramatic worsening of sentiment compared to a year ago when just 23 per cent held that view.

A majority of bosses at banks, as well as asset managers, insurers and private equity firms expressed concerns about the economy’s prospects for the coming year.

Half of the executives surveyed said they expect UK growth to stay at 2017 levels, while 29 per cent expect it to worsen and a fifth believe growth will improve.

Brexit was the most commonly cited risk dragging on the UK’s economic prospects, with 55 per cent saying that they are worried about it.

More than a quarter (28 per cent) said it is the most significant risk their company will face over the coming year, while 24 per cent said they are now less optimistic about leaving the EU than they were a year ago.

The UK’s GDP growth slowed to 0.4 per cent in the last quarter of 2017, meaning a 1.7 per cent expansion for the year – the smallest in the G7.

Robina Barker-Bennett, head of financial institutions at Lloyds Bank, said the financial services sector was a crucial bellwether for the UK economy.

“Fears about Brexit are looming large as the final countdown begins to March 2019, but our survey suggests that the UK economy will prove to be resilient and that it will come through the challenges of the next few months relatively unscathed.

“There is, however, a real risk that our growth will be slower this year than in all other advanced nations, and that we will fall to the back of the G7 pack.”